TIDMTW.
RNS Number : 4143W
Taylor Wimpey PLC
22 December 2021
22 December 2021
Taylor Wimpey plc
Agreement of voluntary undertakings with the CMA
Taylor Wimpey plc today announces that the CMA's investigation
into the historical sale of leasehold properties with doubling
ground rent clauses by the company is closed, following the
agreement of voluntary undertakings. The cost of today's
undertakings falls within the original provision Taylor Wimpey made
in 2017. By entering into these undertakings there is no finding
that Taylor Wimpey has infringed UK consumer law.
The undertakings, which build on the company's Ground Rent
Review Assistance Scheme (GRRAS scheme) - which was launched
voluntarily and proactively in 2017 - mean that all leaseholders of
Taylor Wimpey-owned ten-year doubling ground rent leases, or those
that have already gone through our GRRAS scheme and converted their
Taylor Wimpey-owned lease to an RPI-based structure, will revert to
a fixed ground rent. Taylor Wimpey is making a financial offer, as
agreed with the CMA, to third party freeholders of leases that
Taylor Wimpey no longer owns, to enable their leaseholders to do
the same.
Pete Redfern, CEO, said:
"Taylor Wimpey has always sought to do the right thing by its
customers, shareholders and other stakeholders, and we are pleased
that today's voluntary undertakings will draw this issue to a full
close, within our original financial provision."
The CMA acknowledges that the GRRAS scheme has helped over 5,400
customers convert their ten-year doubling ground rent leases to an
industry standard RPI-based structure, at Taylor Wimpey's cost, and
has addressed the concerns raised regarding mortgageability or
saleability of these properties.
Taylor Wimpey has established a dedicated page on our website
which can be found at
www.taylorwimpey.co.uk/get-in-touch/cma-leasehold-investigation-closure
and will proactively contact all customers with historic doubling
ground rent leases and freeholders who own historic doubling ground
rent leases in early 2022.
ENDS
For further information please contact:
Taylor Wimpey plc
Alice Black, Group General Counsel and Company Secretary Tel: +44 (0) 1494 885616
Andrew McGeary, Investor Relations Tel: +44 (0) 1494 885654
Finsbury Glover Hering
Faeth Birch / Anjali Unnikrishnan / James Gray: TaylorWimpey@Finsbury.com
Notes to editors:
Taylor Wimpey Ground Rent Review Assistance Scheme
Taylor Wimpey took the decision to stop selling leases
containing 10 -- year doubling ground rent clauses on new
developments from 1 January 2012. In April 2017, following a
detailed review, Taylor Wimpey launched a voluntary help scheme
(the Taylor Wimpey Ground Rent Review Assistance Scheme -- GRRAS)
that was specifically aimed at addressing concerns raised by some
customers regarding affordability and how easy it is to sell or get
a mortgage on properties with a ten -- year doubling ground rent
clause.
Under GRRAS, Taylor Wimpey covered the cost of converting
customers' lease terms into an industry standard RPI-based lease,
if they chose to do so. Taylor Wimpey set aside funding of GBP130
million to cover the cost of these lease conversions.
Regarding today's announced undertakings
Taylor Wimpey has worked with the CMA constructively throughout
their investigation and our desire to fully close the issue for the
benefit of our customers and other stakeholders means that we have
given the following voluntary undertakings to the CMA:
Where Taylor Wimpey is the freeholder:
-- With immediate effect, Taylor Wimpey will not collect any
ground rent above the initial level from leaseholders whose leases
originally contained ten-year doubling ground rent clauses (whether
or not their lease has been converted to RPI through the GRRAS
scheme).
-- For any leaseholder whose lease still contains a ten-year
doubling ground rent clause, Taylor Wimpey will offer to formally
vary these leases to remove the doubling clause, so that the
leaseholder will pay only the initial ground rent, which will
remain fixed.
-- For any leaseholder that has already gone through the GRRAS
scheme and converted their doubling lease to an RPI-based
structure, Taylor Wimpey will offer to formally vary their lease to
remove the RPI escalation mechanism, so that the leaseholder will
pay only the initial ground rent, which will remain fixed.
The above will apply whether the leaseholder purchased their
home from Taylor Wimpey directly, or from a previous owner.
Where Taylor Wimpey is not the freeholder:
-- For any remaining ten-year doubling leases, Taylor Wimpey
will make an offer to the owners of the freeholds, which has been
agreed by the CMA, for them to remove the doubling ground rent
clause from each lease and revert to the initial ground rent, which
will remain fixed.
-- For any leaseholder that has gone through the GRRAS scheme
and converted their doubling lease to an RPI-based structure,
Taylor Wimpey will make an offer to the owners of the freeholds,
which has been agreed by the CMA, for them to formally vary their
lease to remove the RPI escalation mechanism, so that the
leaseholder will pay only the initial ground rent, which will
remain fixed.
As noted above, the cost of today's undertakings falls within
the original provision Taylor Wimpey made in 2017.
For further information, please visit the Group's website:
www.taylorwimpey.co.uk
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END
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December 22, 2021 02:04 ET (07:04 GMT)
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